Blunt: Democrats' Budget Clears Way for Resurrection of Death Tax

From PR/US Newswire:

House Republican Whip Roy Blunt (Mo.) released the following statement [yesterday] calling on House Democrats to explain how using their annual budget proposal to resurrect the federal Death Tax represents wise economic policy:

"More than 270 members of Congress, including 42 Democrats, voted last Congress to permanently repeal the Death Tax -- and for good reason. It's a form of double-taxation that penalizes the wrong people for doing the right things, and it does so at a rate that would make even our friends in Europe blush.

"Democrats had an historic opportunity to build on our vote last year and deliver a death knell to the Death Tax. Unfortunately, the majority's budget clears the way for the tax to return in full force just a few years from now - - levying a rate of up to 55 percent, and costing the American economy hundreds of thousands of jobs each year.

"House Democrats should be using the tax code to encourage personal savings and private investments, not as a tool to disincentive work and punish family farmers and small business owners for contributing to and investing in our nation's economic future.

"I'd hope my colleagues from the Midwest, especially -- and others representing our farmland regions -- would think twice before supporting a budget proposal that gives life to the insidious and obscenely timed Death Tax."

The Death Tax is scheduled to phase out over the next few years and will disappear entirely in 2010 -- only to return in 2011 at the unprecedented rate of 55 percent. Small, family-owned businesses are especially vulnerable to the tax, given that most small business owners are forced to count the entire value of their businesses in their estates. More than 70 percent of family businesses do not survive to the second generation. And 87 percent do not survive to a third generation.

During committee consideration of the Democrats' budget resolution, Rep. Mario Diaz-Balart, R-Fla., offered an amendment to ensure that Death Tax would not be restored. His effort was defeated by Democrats 22 to 17.